Each member of the board who is not a GM employee will be paid $200,000 annually for their servicesEnlarge Photo
Gerber has issued a four-day stay of the order approving the sale, which should allow it to close as early as Thursday.
The sale will include substantially all of GM’s assets to the newly established NGMCO Inc., an entity funded by the U.S. Department of the Treasury. Once the sale is completed, NGMCO Inc. change its name to ‘General Motors Company’ and continue to operate under GM's historic corporate and sub brands.
The new company, with Fritz Henderson as CEO, will acquire GM's strongest operations and will have a competitive operating cost structure, partly as a result of recent agreements with the United Auto Workers (UAW) and Canadian Auto Workers (CAW). Furthermore, the new General Motors Company will have lower debt and a stronger balance sheet, which when combined with a lower break-even point, will allow it to reduce its risk and operate profitably at much lower volume levels.
Importantly, GM's subsidiaries outside the U.S., such as Holden and Daewoo, will be acquired by the new company and are expected to continue to operate without interruption.
The company shares will be broken down into a 60.8% stake owned by the U.S. Department of the Treasury, a 17.5% stake owned by the UAW Retiree Medical Benefits Trust, a 11.7% stake owned by the Canadian and Ontario governments, and finally a 10% stake that will consist of the old GM’s bondholders. Additionally, the old GM and the UAW Retiree Medical Benefits Trust will hold warrants that are exercisable for 15% and 2.5% of the interests in the new GM, respectively.
Once the restructured General Motors Company is fully up and running, shares in the company may be offered via an initial public offering conducted by the government. This is expected to take place sometime next year, however, no official confirmation has been given yet.